George Santos Will Be Removed from Congress If He Broke Campaign Finance Laws
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Republican Congressman George Santos will be removed from Congress is he’s found to have broken campaign finance reform laws.
U.S. Representative George Santos, who lied about much of his resume and life story, will be removed from Congress if found to have broken campaign finance laws, fellow Republican and House Oversight Committee Chairman James Comer said on Sunday.
“He’s a bad guy,” Comer said on CNN’s “State of the Union” program. “It’s not up to me or any other member of Congress to determine whether he can be kicked out for lying. Now, if he broke campaign finance laws, then he will be removed from Congress.”
Santos has repeatedly refused to resign, even as pressure has grown within his own party for him to do so. On Thursday, he said he would vacate his New York City-area seat only if he loses the next election.
More than a dozen Republicans officials, many of them from Santos’ district, which covers parts of Queens and Long Island, have demanded the resignation of the newly elected congressman. At least six of his fellow Republican representatives from New York have joined the calls for him to step down.
Meanwhile the WSJ says Santos persuaded at least one person to make a six-figure investment in a Florida-based company that the U.S. Securities and Exchange Commission later said was a Ponzi scheme.
Mr. Santos was hired in 2020 to raise capital for the company, Harbor City Capital, and landed at least one significant investment from a wealthy investor, the people said. When the investment failed to deliver on the promised returns, according to one of the people, Mr. Santos sought to reassure the investor by saying he had personally raised nearly $100 million and had invested his own family’s money in Harbor City.
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Mr. Santos, a 34-year-old freshman Republican member of Congress from Long Island, is facing calls to resign from Democrats and a number of New York Republicans amid investigations into his campaign finances and lies he told during his campaign, pertaining to his education, work history, wealth, ancestry and other matters. The Republicans’ narrow majority in the House made his vote crucial for the election of Kevin McCarthy as speaker.
Mr. Santos has admitted to lying about working at Goldman Sachs Group Inc. and Citigroup Inc. but has defended his experience in the financial-services sector, saying in one interview: “I did work in the industry for a number of years.”
Mr. Santos’s financial-industry experience, according to his résumé, included a job in 2017 with a company that organized conferences for money managers and private-wealth investors, as well as his 2020 stint at Harbor City Capital. Harbor City has been in receivership since soon after the SEC accused it of being a Ponzi scheme in a 2021 civil lawsuit. Mr. Santos was paid for work he did at Harbor City, according to the receiver, Katherine Donlon. She declined to comment further on Mr. Santos’s work for Harbor City.
The SEC declined to comment on Mr. Santos’s role at Harbor City. Mr. Santos has denied wrongdoing and previously said in interviews that he wasn’t named as a defendant in the SEC’s lawsuit against the company. A spokesperson for Mr. Santos didn’t respond to a request for comment for this article.
Mr. Santos didn’t disclose any income from Harbor City on the financial-disclosure forms that federal candidates are required to file when running for office, as earlier reported by the Washington Post.
At Harbor City Capital, Mr. Santos’s job was to bring in investors for the company’s financial offering, one of the people familiar with the matter said. Harbor City said in a 2020 press release that Mr. Santos would serve as regional director of its New York City office and “will represent Harbor City Capital Corp primarily with domestic and international family offices, institutional investors, and high net worth clientele.”
Harbor City promised investors returns from investing in digital marketing campaigns. Such advertising campaigns typically aren’t investor-funded but rather paid for by corporations through their ad agencies as part of their standard marketing budgets.
In investor material viewed by The Wall Street Journal, Harbor City was offering what it alternatively called “secured bonds” or “fixed income strategy” investments. Harbor City promised investors high yields of up to 20% with a secured principal—in some instances claiming that investors “can’t lose” or that their initial investment was “100% safe.” At times the company described the investment vehicle as “digital marketing arbitrage,” suggesting that Harbor City was able to take advantage of inefficiencies in digital advertising to deliver guaranteed returns.
At the time Mr. Santos worked there in 2020, Harbor City proposed using a financial instrument known as a Standby Letter of Credit, or SBLC, to protect investor principal, offering extremely high returns with what the company assured investors was almost no risk, investor materials show.
The SEC alleged that Mr. Maroney, a Florida businessman, ran the company as a Ponzi scheme since 2015 and defrauded more than 100 investors out of more than $17 million. In connection with the SEC’s lawsuit, numerous investors provided sworn statements in Florida federal court describing the same pattern: investing in Harbor City and receiving a handful of the promised distributions of returns before they abruptly stopped. The investor recruited by Mr. Santos experienced just that pattern, according to one of the people familiar with the matter.
Mr. Maroney has said in a court filing that he is the subject of a continuing criminal investigation into Harbor City’s activities, but no criminal charges have been made public. The Harbor City receiver has taken possession of a multimillion-dollar property, as well as Mr. Maroney’s four Jet Skis and his Mercedes automobile in an attempt to recoup money for investors, according to court documents.
Mr. Santos has been facing numerous inquiries about his campaign-financing and business activities since his deceptions came to light, most prominently through reporting by the New York Times. The district attorneys in Queens and Nassau counties, as well as federal prosecutors from the Eastern District of New York, are investigating the congressman, according to people familiar with the matter.
Brazilian authorities said they intend to reopen a criminal investigation into Mr. Santos over charges that he committed check fraud in 2008 in Brazil—a case that had been suspended because police had been unable to find him. Mr. Santos previously said he hasn’t committed any crimes.
